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Fancy suing a company when it’s making money hand over fist. Such is the situation with Apple Inc. (NASDAQ:AAPL) being sued by Greenlight Capital’s David Einhorn as he tries to force the company to grab some cash from under its mattress and put it to work. Einhorn even likened Apple Inc. (NASDAQ:AAPL)’s reluctance to part with its cash hoard to his grandmother’s “Depression mentality.” Is Einhorn an ingrate or just impatient?

In most cases investors like to see a company keeps its hands in its pockets rather than relentless expansion and dubious acquisitions. But Apple Inc. (NASDAQ:AAPL) has too much cash according to Einhorn, $137 billion, and he wants to take $50 billion of that for a perpetual preferred stock issuance yielding 4% or better. Late in the day Apple came out with a statement saying they had already been considering upping the common stock dividend. The Apple statement catalyzed a 3% share price rise just before the February 7 close and rising again on February 8 after Goldman Sachs put out a note approving the public discourse on using Apple Inc. (NASDAQ:AAPL)’s cash hoard.

Does Einhorn Have Apple “Juice”?

Activist shareholders like Einhorn, Icahn, et al. have had some success with other companies implementing their agendas, but we’re talking about Apple Inc. (NASDAQ:AAPL) here. Einhorn is urging fellow shareholders to vote against a proxy proposal that he alleges would effectively deny the Board the ability to offer such a preferred stock class in the future.

Einhorn is dissatisfied also with the $10 billion share repurchase program (with $35 billion more to go). He may have some legal basis for a suit as the Apple shareholder proxy was “bundled” with other corporate governance measures, all too similar to Capitol Hill resolutions, forcing shareholders into an all or nothing position. His legal challenge has some likelihood of winning, too. Apple issued a release categorically stating that the Proposal #2 would not deny future opportunities to issue preferred stock. The proxy vote is scheduled for the February 27 shareholders meeting.

Einhorn is echoing the views of many of Apple’s millions of shareholders as he released, “Greenlight is dissatisfied with Apple’s capital allocation strategy. Apple has $145 per share of cash on its balance sheet. As a shareholder, this is your money. Greenlight believes that Apple’s proposal to eliminate preferred stock from its charter is an unprecedented action to curtail the Board’s options. Greenlight is not aware of any other company that has ever taken this step voluntarily.”

Einhorn holds over 1.3 million Apple shares, a little more than half what CalPERS (California Public Employees’ Retirement System) holds. CalPERS announced it would be backing Apple’s side of the proxy battle. There are several advantages to Einhorn’s side: it keeps ownership by management undiluted, keeps the $100 billion cash on foreign shores from bearing undue tax burdens when repatriated, and lastly draws value investors into the stock.

It isn’t like Apple’s cash is uninvested, almost $130 billion is marking time in corporate securities, funds, government securities, MBSs, CDs and almost every flavor of investment any granny would feel comfortable with until Apple decides what to do with it.